Davis v. Gelhaus

• Decision Date: 23 February 1886
• Parties: DAVIS v. GELHAUS.
• Court: Ohio Supreme Court

4 N.E. 593

44 Ohio St. 69

DAVIS v. GELHAUS.

Supreme Court of Ohio.

February 23, 1886

[Copyrighted Material Omitted]

Error to district court, Hardin county.

August 5, 1880, Gelhaus, who was plaintiff below, filed a petition stating that about May 1, 1865, he and Davis entered into a partnership, and engaged in the grocery business during such period as they might thereafter agree on, and so continued by mutual consent as such partners until February 9, 1880, when by like consent said firm was dissolved. Davis was to take the stock then on hand, collect the assets due the firm, and pay its debts, and from time to time render accounts of his proceedings, and on final adjustment should pay over to Gelhaus one-half (they being equal partners) of what was left after satisfying all partnership liabilities. In pursuance of this agreement Davis became the sole owner of the stock then on hand, as per invoice, together with all other assets, for the purpose of winding up the partnership. He charges that no statements have ever been made, either before or since the dissolution, of the condition of the firm, and that Davis refuses to make a settlement with him of said partnership business. Also that the business during 15 years was largely profitable. He prays that an account be taken, and that on final hearing Davis be compelled to pay over to the plaintiff whatever may be found due him.

On the twenty-ninth of September, 1880, Davis answers, denying that the business had been largely profitable, and denying that he had refused to render statements to his copartner. He sets out the agreement of dissolution, by which he was to take the stock on hand at the invoice, the notes and accounts due, and convert the same into money, and pay off the partnership liabilities as far as they would go. He attaches several exhibits showing the condition of things at the time of dissolution, and also notes and accounts collected on firm account, and the liabilities of the firm paid since the ninth of February, 1880. Among these is Exhibit C, which he avers contains a true statement of the liabilities of the firm at the date of dissolution, amounting to $9,830.24. Of this amount $6,893.22 are alleged to be liabilities of the firm as public moneys belonging to Pleasant township, Hardin county. Between the time of dissolution, February 9th, Davis had paid, of these public moneys, sufficient to leave a balance of $5,424.70 at the date of filing his answer, to-wit September 29, 1880.

Gelbaus died October 4, 1880, and Curtis Wilkin was appointed his administrator, and on the sixth of January, 1881, filed a reply stating that he has no knowledge of the matter set up in the answer, and therefore denies each allegation thereof except as to the existence of the firm and the agreement for dissolution. He repeats the prayer for an account, and for other and further relief. The case was then referred to a master to hear the evidence, and to report his findings of law and fact to the court.

The real and only matter in controversy, as shown by the proceedings, is as to whether the debt due Pleasant township was a partnership liability, or the individual liability of Davis. At the time the case was heard in the common pleas Davis had paid all liabilities, amounting to $9,709.30, which included the amount due to the treasurer of Pleasant township. The common pleas found that this liability to Pleasant township was a partnership liability, and that its payment by Davis came within the terms of the agreement of dissolution, which authorized him to pay all partnership liabilities of the firm, and that, as such liability had been paid by him, he was entitled to a credit therefor the same as for any other liability of the firm. Wilkin, as administrator, took an appeal to the district court, where the judgment of the common pleas was reversed; holding that, as to these public moneys owing to Pleasant township, they were not partnership liabilities; and the court refused to give him credit for the amount paid in satisfaction of them after dissolution, and struck from his credits numerous orders paid on account of the firm before his answer, and refused to allow him credit for the residue owing to the township, which he had paid before the hearing in the common pleas.

As to the amount of ‘ firm liabilities, as set out in second defense of answer of defendant, $5,424.70, alleged to be due the defendant as treasurer of Pleasant township of said county, the court do find that, during the entire period of said partnership, Archibald M. Davis was the treasurer of Pleasant township, in said county, and of the incorporated village of Kenton during the greater part of said time; that during said partnership, and from September, 1865, to the dissolution thereof in 1880, said Archibald M. Davis, as treasurer as aforesaid, did receive of said public money the sum of $171,178.56, and during said period did disburse thereof $164,752.57, leaving a balance due said corporation and township, at the date of dissolution of said firm, of $6,415.99; that from February 17, 1869, to the dissolution of said firm in 1880, said Archibald M. Davis did deposit, of said public moneys received as aforesaid, in bank, to the credit of the firm of Davis & Gelhaus, the sum of $155,285.05; that no separate account was kept in bank of the public moneys so deposited, but the same was carried into and made a part of the bank-account of the firm of Davis &amp Gelhaus; that it was the custom of said Archibald M. Davis to pay corporation and township orders, the amount not being shown by the evidence, from the money he drew and received as aforesaid, and, after such payment, to deposit the balance remaining in bank to the credit of Davis & Gelhaus; that no partnership account was kept with Archibald M. Davis showing the amount of moneys which the firm received from said Archibald M. Davis as treasurer, except as the same appeared in the bank pass-books; that August Gelhaus knew that said Archibald M. Davis was depositing the public moneys aforesaid to the credit of the firm of Davis & Gelhaus in bank, and made no objection to the same, but, on the contrary, was a party to and approved the same; that, at the dissolution of said firm, statements were made of the liabilities of said firm of Davis & Gelhaus, and said statements contained (among other liabilities) the balance due from Archibald M. Davis, as treasurer aforesaid, to said corporation and township at date of the dissolution of said firm, Exhibit C in defendant's answer being a copy thereof, and that said statements were furnished to each of the members of said firm, and no objection made thereto until the bringing of this suit; that at the dissolution of said firm there was a balance in bank to the credit of said firm (being the bank where said public moneys were deposited as aforesaid) of $760.08, all except said sum being checked out; that the proof fails to show what was done with said sum of $155,285.05 of public moneys so deposited as aforesaid, except that the same, as well as all firm deposits, had been checked out of bank (except said balance of $760.08) at the date of the dissolution of said firm; that the conclusion from the foregoing is that in the absence of proof as to what was done with the said $155,285.05 of public moneys deposited as aforesaid, that the said Archibald M. Davis, as treasurer as aforesaid, performed his duty, an paid the same...